Undercurrents: Exit Fee Proposal Bashed by Mayors

Updated Sept. 6.

The mayors of major Bay Area cities Sept. 3 protested a proposal by the California Public Utilities Commission released last month that would raise exits fees for community choice aggregators.

San Francisco Mayor London Breed, San Jose Mayor Sam Liccardo and Oakland Mayor Libby Schaaf said the tentative decision by Commissioner Carla Peterman would immediately raise non-utility customers’ rates by up to 25 percent and hamper community energy programs’ clean energy efforts.

The three cities’ community energy programs replace electricity resources that were provided by Pacific Gas & Electric.

“At a time when President Trump is dismantling environmental regulations that address global climate change, California and our cities must continue to lead,” said San Francisco’s Breed.

“This manipulation of the CPUC rule-making process by PG&E and other utilities will handcuff our residents from making sustainable choices, undermine local control of green energy production, and harm our planet,” added San Jose’s Liccardo.

Peterman’s alternate decision to reform the controversial Power Charge Indifference Adjustment mechanism would strike a competing proposal’s 10-year limit on recovering the cost of long-term investor-owned utility resource contracts. The time limit, and resulting lower PCIA, was pitched earlier by Commission Administrative Law Judge Stephen Roscow .

P eterman’s plan, unlike Roscow’s, also would allow continued recovery of pre-2002 contracts assigned to the investor-owned utilities. She also calls for a significantly higher annual cost cap that the three private utilities can impose on customers of alternate power providers. It could add 2.2 cents a kWh, or up to a 25 percent increase.

The trio of mayors support Roscow’s proposal on grounds it “properly balances the elements that make up the exit fees.”

There are 19 community choice aggregation programs throughout the state, which replace private utility power supplies.

The San Francisco based CPUC may vote on the two exit fee proposals at its Sept. 13 meeting. That would be in the middle of Gov. Jerry Brown’s three-day Global Climate Action Summit, also to be held in Fog City. ﮞ ﮞ ﮞ ﮞ ﮞ

NRG Energy announced it finalized its sale of the vast majority of its renewable assets held by NRG Yield and Renewables to Global Infrastructure Partners.

The asset sale netted $1.348 billion in cash proceeds, a bit below the $1.375 billion price tag announced Feb. 7. At that time, NRG noted the sale would be “subject to certain adjustments.”

The cash infusion, according to the company, removes $6.7 billion of debt from NRG’s balance sheet.

“The asset sales are a critical part of our transformation and we are pleased to achieve this significant milestone, which aims to focus our company while strengthening our balance sheet and delivering value to shareholders,” said Mauricio Gutierrez, NRG president and chief executive officer.

NRG continues to hold a majority interest in the 392 MW Ivanpah solar project in the Southern California desert. It also owns five natural gas plants in California, including Encina, Long Beach, Midway Sunset, Watson and the San Diego Turbines.

The company will recommence its $1 billion plan to buy back shares. At the end of June I it paid $500 million for 15.7 million shares. ﮞ ﮞ ﮞ ﮞ ﮞ

Senate Energy & Natural Resources Committee Ranking Member Maria Cantwell (D-WA) and House Energy & Commerce Ranking Member Frank Pallone, Jr. (D-NJ) criticized Federal Energy Regulatory Commission Chair Kevin McIntyre’s response to their earlier complaint that his chief of staff made inappropriate and biased comments to an industry group.

“It was encouraging to hear Chairman McIntyre clarify that the commission’s official orders, like the 5-0 rejection of the Trump coal bailout, are what count,” said Cantwell. She added, however, that McIntyre and other commissioners need to “publicly affirm that political and partisan statements perceived as prejudging an issue are not appropriate by the commission or staff.”

Pallone said he was “disappointed that he failed to acknowledge in the least that the partisan comments of his Chief of Staff, Anthony Pugliese, were wholly inappropriate, unhelpful and distasteful.”

The two Democrats complained last month about comments Pugliese made at a nuclear power conference indicating that FERC was actively looking for ways to “value resilience” and ensure that “baseload” 24-hour-a-day generators are kept in business. His remarks came after the commission rejected a Trump Administration proposal to subsidize coal and nuclear plants in competitive electric markets earlier this year.

McIntyre responded to the complaint by the two lawmakers, saying “The commission speaks exclusively through its orders. Consequently, neither the public statements of Mr. Pugliese nor those of any other FERC staff member can state the views of the commission.”

McIntyre added that Pugliese notified him in advance of the speaking engagement at the American Nuclear Society and said he planned to cover “matters of general interest, such as cybersecurity concerns, grid resilience, and the nation’s changing generation mix.”

The FERC chair added that Pugliese is qualified to serve as his chief of staff and has “demonstrated leadership ability.” — Elizabeth McCarthy & William J. Kelly

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Undercurrents: Exit Fee Proposal Bashed by Mayors

William J. Kelly

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